Cognitive biases and power in colective decision making

Abstract

The present work analysed the relationship between cognitive biases and power in a collective decision making context. Notably, the analyse of investment clubs indicated that power may affect confidence in a stock market forecasts, self-assessment related to investment skills, beliefs on control and predictability of outcomes, and attributions of success and failures concerning collective investment performance. In sum, powerful investors in club settings were more overconfident, showed greater better-than-average perceptions, and were more prone to illusion of control and self-attribution that investors in powerless position, according with the assumption that biases might be reinforced to a greater extent by social variables.